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ECONOMICS REPORT - WTO Makes Progress on Doha Round of Talks

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This is Bob Doughty with the VOA Special English Economics Report.

Rich and poor nations have produced a new set of trade agreements at the World Trade Organization. The main issue for many developing countries was government support for farmers. Developing nations say rich nations give support called subsidies to farmers. They say this drives down the price of agricultural goods.

Now, WTO members including Brazil, the European Union, Japan and the United States have agreed to reduce subsidies.

The WTO General Council met last week in Geneva, Switzerland, to negotiate what is called the Doha Round of trade talks. This series of talks deals with more than forty trade issues in twelve areas.

Members agreed to cut agricultural subsidies by twenty percent in the first year of the agreement. Export subsidies are to be completely ended in the future.

Special consideration is given to developing countries. Some products are recognized as more important than others to a nation's economy.

The agreement notes the importance of cotton to developing countries. It says cotton trade will be dealt with in a different way from other agricultural issues.

The agreement also calls for the highest import taxes on agricultural goods to be cut by the largest amount.

In a victory for many developing countries, members voted not to deal with three of four so-called Singapore issues. These are trade issues that industrial nations wanted to negotiate as a group in this series of talks. They include easing trade restrictions, investment, competition policy and policies on how governments buy goods. Now, members will only negotiate easing trade restrictions in the Doha Round.

Industrial countries also received something in the agreement. Members agreed to create a system for cutting import taxes on industrial goods over time. They also agreed to negotiate decreasing or ending some import taxes.

Members agreed to provide a plan on how they can open their economies to service industries. Each nation must create a plan by May, two thousand five. WTO members also agreed not to ban foreign companies from any service industry. And they agreed to make it easier for their citizens to work in other countries.

The WTO General Council plans to meet again in October.

This VOA Special English Economics Report was written by Mario Ritter. This is Bob Doughty.

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